Groundstar Resources Limited Announces Closing of Private Placement Financing and Operations Update
24 December 2013 - 4:39PM
Access Wire
Calgary, December 23,
2013 -Groundstar Resources Limited (TSXV: GSA US: GRDSF
symbol) (the "Company") is pleased to
announce that it has closed on its previously announced private
placement financing of units and common shares in the capital of
the Corporation issued on a "flow-through" basis
("Flow-Through
Shares") pursuant to the provisions of
the Income Tax Act
(Canada). The Company issued and closed
approximately 7.1 million Flow-Through Shares and 0.3 million
common shares for aggregate gross proceeds of approximately $1.5
million. The Company received additional demand by subscribers
wishing to purchase Flow-Through Shares that it amended the
allocation such that up to 8.5 million shares may be issued
pursuant to the financings. The Company expects an additional
closing of the offering prior to year end and may issue up to 0.5
million common share units and up to 0.6 million Flow-Through
Shares such that now up to $1.7 million in total gross proceeds may
be subscribed. A syndicate of agents, including PI Financial Corp.
and Canaccord Genuity Corp. as co-lead agents, were involved with
the offering and were issued a total of approximately 0.45 million
agents' warrants, exercisable for a period of 18 months from the
closing date at a price of $0.18 per share. The Company expects to
use the net proceeds from the offering to further the exploration
and development activities of its oil and gas properties. The
proceeds received by the Company from the sale of the Flow-Through
Shares will be used to incur eligible Canadian Development Expenses
("CDE") and Canadian Exploration Expenses ("CEE") which will be
renounced in favour of subscribers for the 2013 taxation year. The
securities were issued on a private placement basis and are subject
to a statutory hold period of four months and a day from the
closing date of the offering, such hold period to expire on April
23, 2014. Jordan Capital Markets Inc. also participated in the
financing.
Based upon
Groundstar's recent drilling success in Saskatchewan, the Company
is pleased to announce the licensing of a follow-up drilling
location at 4-13-45-26 W3. The location, targeting additional
potential in the Manville formation, is expected to drill early in
the New Year. As well, Groundstar has expanded its agreement with
the mid-sized oil and gas producer with extensive land and
proprietary seismic data base in the area, and expects that recent
funding proceeds may be allocated to development drilling. At it's
Viking, light oil opportunity, the Company is completing an
Authority For Expenditure relevant to the drilling of a vertical
well which is scheduled as part of the 2014 work
program.
This news
release does not
constitute an offer
to sell or
a solicitation of an
offer to buy
any of
the securities in
the United States. The
securities have not
been and will not
be registered under the
United States Securities Act of
1933, as
amended (the "U.S. Securities Act") or
any state securities laws and
may not be
offered or sold within
the United States
or to U.S.
Persons unless registered
under the U.S. Securities Act and
applicable state securities laws or
an exemption from such registration is
available.
About Groundstar Resources Limited
Incorporated in 1968, Groundstar
Resources Limited is a diversified publicly traded oil and gas
company with oil production and exposure to 7.3 million gross acres
of resource assets. The Company is actively growing a portfolio
targeting producing oil and gas assets with development
opportunities and exploration upside. The Company's current
portfolio of assets provides both near term and longer term
potential. Groundstar is quoted and trades under the ticker symbol
"GSA" in Canada and "GRDSF" in the United States.
Neither the TSX
Venture Exchange nor its Regulation Services Provider (as that term
is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
This press release contains forward-looking
statements within the meaning of applicable securities laws,
including expectations regarding the anticipated closing of a
second tranche of the offering, the gross proceeds expected to be
received in connection therewith and the anticipated use of
proceeds from both offerings. Although the Company
believes that the expectations
reflected in such forward-looking statements are reasonable, it can
give no assurance that such expectations will prove to be correct.
These statements are subject to certain risks and uncertainties and
may be based on assumptions that could cause actual results to
differ materially from those anticipated or implied in the
forward-looking statements. These risks include, but are not
limited to: the risks associated with the oil and gas industry
(e.g. operational risks in development, exploration and production;
delays or changes in plans with respect to exploration or
development projects or capital expenditures; the uncertainty of
reserve and resource estimates; the uncertainty of estimates and
projections relating to production, costs and expenses and health,
safety and environmental risks), commodity price and exchange rate
fluctuation, uncertainties resulting from potential delays or
changes in plans with respect to exploration or development
projects or capital expenditures and uncertainties regarding
whether regulatory approval for the offerings will be received and
if received, on the timelines expected, as well as the intended use
of the net proceeds of the offerings. The Company's forward-looking
statements are expressly qualified in their entirety by this
cautionary statement. The
forward-looking statements contained in this press release are made
as of the date hereof and the Company undertakes no obligations to
update publicly or revise any forward-looking statements or
information, whether as a result of new information, future events
or otherwise, unless so required by applicable securities
laws.
NOT FOR DISTRIBUTION TO U.S.
NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES. ANY
FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION
OF U.S. SECURITIES LAWS.
Contact
Information: Contact
Information:
Groundstar Resources
Limited, Suite 2300, 144 4th Avenue SW, Calgary, Alberta T2P
3N4
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|Groundstar Resources Limited |www.groundstarresources.com |
|---------------------------------------------------------------|
|Chad Dust 403 608 6505 or 403|Tyron Pfeifer 403 614 9902 |
|265 2549 |tpfeifer@groundstarresources.com|
|cdust@groundstarresources.com | |
| | |
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